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Plumbing News

March 23, 2007 - Home Depot Undecided On HD Supply

By Steve Smith
March 23, 2007
The Home Depot Inc. hasn’t reached any decisions to sell HD Supply, but it is rolling out additional retail marketing plans and store expansions.

The Home Depot Inc. hasn’t reached any decisions to sell HD Supply as it announced additional retail plans, including paying trade professionals $30 an hour to staff stores as well as building bigger and smaller stores.

“We have not decided one way or another what to do with the supply business,” said Frank Blake, chief executive, at a Merrill Lynch retailing conference in New York yesterday. He also added that the idea that the struggling retailer will definitely sell its wholesale operations is wrong.

The company has not said whether it has received any offers for HD Supply, although most speculation says the first round of bids may already be on Blake’s desk.

Since announcing the possibility of selling HD Supply, however, the company has continued to make moves toward the professional trades - even buying a chain of construction supply centers earlier this month to add to territory not well covered by HD Supply before.

The company has also said it plans to spend $415 million on “Own the Pro” professional customer marketing this year, including credit, direct ship and loyalty programs.

In other news at the retail conference, Home Depot outlined plans to invest in its 2,000-plus retail outlets and build additional stores:

  • The company will offer as much as $30 an hour to hire trade specialists for some of its retail stores.

    Although the company won’t say exactly how many professionals it may hire, Home Depot does intend to add 83,000 new employees by mid-year to staff its stores. The company interviews 350,000 people each year for store jobs.

  • The company will try out even bigger stores as well as much smaller stores.


Home Depot is currently building its largest store ever in Union, N.J., big enough to fit four football fields inside. The store is going up on the site of a closed Home Depot Expo Design Center. The superstore concept will attempt to merge the more upscale Expo merchandise with a regular Home Depot store. If successful, the company may build others in 50 top markets across the country.

Meanwhile, junior versions of Home Depot will soon open in the San Francisco Bay area.  These stores will be about half the size of the Home Depot’s typical big box. Late last year, Home Depot bought a local chain called Yardbirds, which are currently being converted into the new smaller Home Depots. The company already has plans to open two others in Georgia later this year.

“The marketplace for the traditional home improvement store is shrinking, and there’s not much we can do within that realm,” said Mike LaFerle, vice president of real estate. “We said we’re going to open 400 to 500 stores by 2010, so we have to look at multiple new designs as part of that.”

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Steve Smith was editor of Plumbing & Mechanical from 1996-2009.

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